While the 2011-12 budget offered a mixed bag to the realty sector, developers believe that very little was extended to them and customers and not enough steps were taken to improve the significance of the housing sector.

However, the real estate industry remains optimistic and looks forward to some reforms in the coming budget. The real estate sector is primarily looking forward to the RBI's intervention to control the inflation which has adversely affected the industry. A sheer relief could be by bringing in affordable housing.

"We expect revision in tax for affordable housing projects in order address the acute housing shortage in the country," says Shailesh Sanghvi, Director, Sanghvi Group of Companies. Affordable housing should be considered important with priority lending given to banks who could in return offer concessional costs to keep the cost of tenements within the reach of common man.

"The budget should look forward to extending the existing benefit of Section 80 IB(10) of the IT Act for developing affordable housing as the country is still in a huge shortage of tenement, adds Ajmera.

Last year, a 1% interest rate rebate was provided for affordable housing costing between Rs 10-15 lakh. Anuj Puri, Chairman & Country Head, Jones Lang LaSalle India is of the opinion that the scope of this rebate should be amplified and broadened to include a wider price band of budget housing so as to boost the flagging sentiments in the housing sector.

Additionally, Sanghvi is of the opinion that the interest subvention of 1% on home loans could be raised from Rs 20 lakh to 30 lakh due to increase in cost of raw materials and various taxes incurred during home buying. Additionally, allocating more funds to the Rajiv Gandhi Avaas Yojana will do well to the real estate sector.

The real estate industry is also hoping to get an industry status as the sector is a major driver for economic growth and generates countless jobs across its various verticals. As the second largest employer in the country contributing 5% to India's GDP, Indian Realty deserves a preferred treatment to give a further boost to our economy. Industry status would help the sector to access debt lending at more competitive interest rates and lower collateral values.

"Granting the real estate sector an industry status should be acceded to in the forthcoming budget as this would enable it to have access to organised funds from banks and financial institutions. In addition to getting easier and cheaper finance, the industry status would bring in a much deserved discipline in this sector, especially when the government is giving priority to mass and affordable housing projects," says Manju Yagnik, Vice-Chairperson of Nahar Group.

There is a severe shortage of finance and whatever finance is available is coming in at a huge rate which is fuelling the realty prices and also many a times makes developers scrap the launch of new projects. The real estate industry also expects the Finance Ministry to relax the norms on FDI and ECB, especially for township projects which will give developers source funds at a much reasonable cost.

"Relaxing norms for repatriation of FDI in real estate is the need of the hour. Currently, it is not possible for foreign investors to repatriate real estate investment proceeds for a period of three years, which is hampering investment flow into India. The market environment needs to be rendered more investment-friendly," says Puri.

Meanwhile, an increase in infrastructure spending in urban areas with a view to unlock the value of neglected and hidden land assets in suburban and peripheral districts is expected.

"With growing urbanisation in metros, the real estate sector is seeing huge opportunity for creating newer townships. It is vital that the government promotes townships alongside industrial belts and give developers fiscal benefits to township development to entice developers in this segment, says Ajmera. Additionally, clear guidelines should be announced by government in order to avoid any kind of ambiguity on point of levying Service Tax on under construction projects.

Finally, Yagnik concludes that considering that nearly 35% of sale value of a home consists of various taxes such as excise, VAT, service tax, stamp duty among other things, "we hope that the Budget 2012-13 would bring about appropriate reductions in their tax rates, to the delight of home-buyers who are already burdened with high interest rate for housing loans" .